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Pampa Energia SA (NYSE:PAM)
Beneish M-Score
-0.29 (As of Today)

Warning Sign:

Beneish M-Score -0.29 higher than -2.22, which implies that it might have manipulated its financial results.

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Pampa Energia SA has a M-score of -3.64 suggests that the company is not a manipulator.

PAM' s 10-Year Beneish M-Score Range
Min: -3.41   Max: 0.7
Current: -0.29

-3.41
0.7

During the past 11 years, the highest Beneish M-Score of Pampa Energia SA was 0.70. The lowest was -3.41. And the median was -2.36.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Pampa Energia SA for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 2.1163+0.528 * -1.549+0.404 * 0.5954+0.892 * 0.7072+0.115 * 1.3417
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.7827+4.679 * -0.0517-0.327 * 1.2493
=-3.64

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $282.2 Mil.
Revenue was 172.0375 + 178.82475 + 142.298125 + 174 = $667.2 Mil.
Gross Profit was -7.4 + -2.942875 + -9.427875 + -12.6125 = $-32.4 Mil.
Total Current Assets was $444.8 Mil.
Total Assets was $1,570.3 Mil.
Property, Plant and Equipment(Net PPE) was $862.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $29.8 Mil.
Selling, General & Admin. Expense(SGA) was $149.2 Mil.
Total Current Liabilities was $576.8 Mil.
Long-Term Debt was $365.6 Mil.
Net Income was -12.325 + -20.07625 + 116.480875 + -75.75 = $8.3 Mil.
Non Operating Income was -34.1125 + -0.344125 + -21.986 + -7.7875 = $-64.2 Mil.
Cash Flow from Operations was 86.16025 + 62.419875 + 5.12125 + 0 = $153.7 Mil.
Accounts Receivable was $188.6 Mil.
Revenue was 305.298 + 235.569875 + 223.907625 + 178.5625 = $943.3 Mil.
Gross Profit was 36.2355 + 6.1 + 7.740875 + 20.85 = $70.9 Mil.
Total Current Assets was $265.4 Mil.
Total Assets was $1,416.4 Mil.
Property, Plant and Equipment(Net PPE) was $753.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $35.3 Mil.
Selling, General & Admin. Expense(SGA) was $118.3 Mil.
Total Current Liabilities was $403.0 Mil.
Long-Term Debt was $277.3 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(282.2375 / 667.160375) / (188.5735 / 943.338)
=0.42304296 / 0.19990025
=2.1163

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(-2.942875 / 943.338) / (-7.4 / 667.160375)
=0.0751866 / -0.04853893
=-1.549

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (444.7625 + 862.85) / 1570.325) / (1 - (265.390375 + 752.987875) / 1416.3585)
=0.16729817 / 0.28098836
=0.5954

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=667.160375 / 943.338
=0.7072

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(35.34175 / (35.34175 + 752.987875)) / (29.82725 / (29.82725 + 862.85))
=0.04483118 / 0.03341325
=1.3417

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(149.19425 / 667.160375) / (118.336125 / 943.338)
=0.22362577 / 0.12544403
=1.7827

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((365.55 + 576.775) / 1570.325) / ((277.310375 + 403.007125) / 1416.3585)
=0.60008279 / 0.4803286
=1.2493

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(8.329625 - -64.230125 - 153.701375) / 1570.325
=-0.0517

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Pampa Energia SA has a M-score of -3.64 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Pampa Energia SA Annual Data

Jun05Jun06Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.53990.53550.87671.03621.04250.8772.1222
GMI 1.4851.0931.0541.18951.54581.5546-1.559
AQI 0.56111.08390.77040.80852.65490.78220.5954
SGI 11.58482.71351.01981.161.22561.29990.7053
DEPI 0.82030.50331.08851.00740.8150.99731.222
SGAI 0.80580.88341.14781.08721.00491.04141.7188
LVGI 1.04531.11490.93571.12291.12721.15851.1839
TATA -0.0243-0.0633-0.0942-0.0554-0.1359-0.1495-0.0778
M-score 6.50-1.67-3.08-2.59-1.98-2.88-3.75

Pampa Energia SA Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 3.12181.04251.02280.76120.84450.87910.68521.56081.93252.1163
GMI 1.34391.54571.66171.72512.17851.59272.63333.7244.5451-1.549
AQI 0.72122.65491.79020.83692.00110.78221.30290.68180.76010.5954
SGI 1.23551.22561.17021.20151.18391.29681.27121.09120.98160.7072
DEPI 1.34540.8150.81381.28570.92451.38761.10511.1371.07711.3417
SGAI 1.04581.00511.09920.97490.98031.02751.05121.33961.45781.7827
LVGI 1.31921.12721.19111.11821.04421.15850.95871.15581.16821.2493
TATA -0.0766-0.0905-0.097-0.1119-0.1084-0.1261-0.164-0.0393-0.0636-0.0517
M-score -0.68-1.77-2.19-2.73-1.96-2.70-2.29-0.85-0.29-3.64
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